". . . for almost a century the basic principles on which this civilization was built have been falling into increasing disregard and oblivion." -- Hayek

Saturday, March 08, 2008

Olson's Logic In Neverland

BY LISA WERMUTHfor Econ 453 Power & Prosperity

Peter and Wendyis a children’s novel.However, the benefits of this delightful book extend far beyond merely entertaining young people.The inhabitants of Neverland take part in the most extraordinary adventures while behaving as rational human beings who are each a member of a group.For this reason, J.M. Barrie’s work is an excellent case study for students of Mancure Olson’s book The Logic of Collective Action.Neverland is home to two distinct groups.First I will discuss the classic small group represented by the Lost Boys.Then, I will analyze the large group behavior of the Pirates.

Peter and Wendy by J.M. Barrie is the story of a boy who never grows up.One night, Peter Pan flies in to the nursery in search of his shadow.There he meets Wendy, John, and Michael.Peter Pan teaches the children to fly and takes them to Neverland.Neverland is an island that the children have all imagined.They are shocked and delighted when they find the island is real.The island is inhabited by wild beasts, mermaids, redskins, pirates, and a band of motherless boys.Our hero, Peter Pan, is the leader of the orphans who call themselves the Lost Boys.In Pan’s absence, the people on the island have carried on in its usual routine.The Lost Boys go hunting for Peter Pan.The Pirates hunt the Lost Boys.The Redskins hunt the Pirates and the wild animals hunt the Redskins.When Peter Pan returns to Neverland, John and Michael fit right in with the Lost Boys and Wendy agrees to become their “mother.”Life in Neverland would continue without disturbance if it were not for the dreaded Captain James Hook.Captain Hook is the ruthless leader of the Pirates.Hook also has a deep seated hatred of Peter Pan and is determined to destroy the cocky boy.One night, Hook orders his band of swashbuckling pirates to capture the Lost Boys.Hook believes he has poisoned Peter Pan.However, Pan has a narrow escape and is able to rescue Wendy and the Lost Boys.Once they are free, the Lost Boys destroy the Pirates and Peter Pan himself drives Hook to his death.At the conclusion of the grand adventures, Pan returns Wendy, John, and Michael back their nursery.

The Lost Boys are a small group in which all its members share common goals.Each one of the seven boys shares a common need for food, shelter, and protection.In addition, each has a desire for care and attention.As is the nature of small groups, Peter Pan does not need to use force to keep his group together.The many collective and non-collective goods that the boys gain from group membership are more than enough to hold the group together.Their collective goods include the benefit of safety and the comfort of the underground home (Barrie 120).According to Olson, “social status and social acceptance are individual, noncollective goods (61).”Therefore, the affection each member receives in a noncollective good, along with the food he eats.

Social pressure is another factor that adds coherence to the group.According to Olson, “social pressure and social incentives operate only in groups of smaller size, in the groups so small that the members can have face-to-face contact with one another (62).”There are multiple instances where the Lost Boys use this kind of social pressure to influence group members.In one example, Tootles mistakes Wendy for a bird and shoots her out of the sky.Once he realizes what he has done, Tootles turns to leave the group.The other boys beg him not to go.When they ask him why he can’t stay he simple responds, “I can’t, I’m so afraid of Peter (124).”There is no evidence that leads us to believe that Peter would actually punish Tootles in any way for his mistake.Merely the thought of displeasing his hero and beloved leader was enough to drive Tootles to despair.

The Lost Boys are an effective, action-taking group.Olson presents the findings of his colleague that help us to better understand the logic behind the Lost Boys proficiency as a group.Olson explains, “Professor James found that in a variety of institutions, public and private, national and local, “action taking” groups and subgroups tended to be much smaller than “non-action taking” groups and subgroups.In one sample he studied, the average size of “action taking” subgroups was 6.5 members, whereas the average size of the “non-action taking subgroups was 14 members (54).”With a membership of seven boys, Peter Pan’s troop fits this description perfectly.Hunting wild beasts, playing make believe, or fighting off Pirates, the Lost Boys efficiently utilize their resources.For example, when Wendy first comes to the Neverland, Peter suggests they build her a house.

“’Quick,’ he ordered them, ‘bring me each of you the best of what you have.Gut our house.Be sharp.’In an instant they were busy as tailors the night before a wedding.They scurried this way and that, down for bedding, up for firewood, and while they were at it who should appear but John and Michael….’Curly,’ said Peter in his most captiany voice, ‘see that these boys help in the building of the house.’…The astonished brothers were dragged away to hack and hew and carry (128).”

When this small group takes on a project, they are quick to act and maximize the utility of every available asset.Nothing stands between Peter and the boys when they are on a mission.This illustrates the point that Olson is making when he says that “small, centripetally organized groups usually call on and use all their energies, while in large groups, forces remain much oftener potential (54).”

Another example of the efficiency of our small group is when the Lost Boys embark on a lobbying campaign for a desired collective good.The boys want Wendy to become their mother.When they are finished building Wendy’s house they approach her with their request.Each boy contributes to the plea adding his own personal inputs.There is not a free-rider among them.Wendy is unsure at first until “all went on their knees, and holding out their arms cried, ‘O Wendy lady, be our mother.’ (131)” At this, the dear girl is won over.The lobby was a success.From that moment on, Wendy mothers the boys to the best of her abilities.She willingly cooks their meals, mends their clothes, nurses their wounds, tells them stories, and tucks them into bed at night.It may seem irrational for Wendy to work so hard.However, even though Wendy contributes to the group more than any of the boys, she is given selective incentives for her dedicated efforts.She lives in her own house, enjoys a pet wolf, and has a button that was given to her as a special gift from Peter.She also has the love and admiration of “her” boys.

On the other side of the island, there is another group that is altogether different from the jolly Lost Boys.The Pirates are the second group we will analyze.Captain Hook has seventeen men under his brutal command.Hook controls the size and actions of his large group by force and coersion.There are no apparent collective goods offered to followers of the infamous James Hook.Furthermore, the Captain would never consider offering selective incentives.In short, the Pirates are The Neverland edition of a union.Mancur Olson states that “by far the most important single factor enabling large, national unions to survive was that membership in those unions… was to a great degree compulsory (68).”Signing with Hook is compulsory for anyone in the Pirate profession who wishes to practice in Neverland.The very nature of the Pirate business is all about coercion.Hook has a monopoly on pirate ships and runs a strict union-ship policy among his crew.Moreover, the barriers of entry for piracy are insurmountable.If an individual wanted to be an independent pirate he would have to build a ship by himself from the limited resources of the island while warding off the Lost Boys, the Redskins, and the dreaded Hook.The Lost Boys discover for themselves what Hook will do to anyone who will not join his crew.One night, the Pirates raid the underground home of the Lost Boys and carry them off to their pirate ship.Hook addresses the boys as they are tied to the mast and informs them that he needs two cabin boys.All those who do not volunteer will be forced to walk the plank.When every boy refused to sign on “the infuriated pirates buffeted them in the mouth and Hook roared out, ‘That seals your doom.Bring up their mother.Get the plank ready’ (192).”

In response to Hook’s brutality, the Pirates waste no time in explicitly following his orders.Even though there is no perceived benefit for the individual members of the group, they still strive to carry out Hook’s ultimate goal.Early on, Hook shares his goal with his first mate Smee when he says, “’Most of all,…I want their captain Peter Pan.‘Twas he cut off my arm.’He brandishes his hook threateningly.‘I’ve waited long to shake his hand with this. Oh, I’ll tear him’ (119).”Even though the crew labors to capture Peter Pan, none try harder than Captain Hook himself. Olson explains this behavior when he says:

“One point is immediately evident.If there is some quantity of a collective good that can be obtained at a cost sufficiently low in relation to its benefit that some one person in the relevant group would gain from providing that good all by himself, then there is some presumption that the collective good will be provided.The total gain would be so large in relation to the total cost that some one individual’s share would exceed the total cost (22).”

Hook believes that the personal benefit he would derive from Peter Pan’s death is so great, he is willing to carry the cost for the entire group of Pirates.

Neverland may not be the first place economic students would look for a case study.However, economists who go the Neverland will find two groups of people who behave rationally in group situations.The Lost Boys demonstrate the effective, action taking, small group while the Pirates exemplify a powerful and coercive union.Mancure Olson’s study of group theory is as true as the fact that Peter Pan will never grow up.The Logic of Collective Action is logical today and will be tomorrow.Olson’s theory is true in Professor Eubanks political economics class… and yes, even in Neverland.